Sunbeam 2010 Annual Report Download - page 39

Notes to Consolidated Financial Statements
Jarden Corporation Annual Report 2010 (Dollars in millions, except per share data and unless otherwise indicated)
tax valuation allowances and tax uncertainty accruals as adjustments to income tax expense. This Guidance also requires any
adjustments related to pre-existing tax contingencies for prior acquisitions to be recorded in the income statement. This Guidance
was effective for the Company for business combination transactions occurring after December 31, 2008. The adoption of the
provisions of this Guidance, effective January 1, 2009, did not have a material effect on the consolidated financial position, results of
operations or cash flows of the Company (see Note 3 for disclosures related to the adoption of this Guidance).
3. Acquisitions
On April 1, 2010, the Company acquired the Mapa Spontex Baby Care and Home Care businesses (“Mapa Spontex”) of Total S.A.
(“Total”), through the acquisition of certain of Total’s subsidiaries for a Euro purchase price of approximately C
=
200 (approximately
$275), subject to certain adjustments (the “Acquisition”). The total value of the transaction, including debt assumed and or repaid,
was approximately C
=305 (approximately $415). Mapa Spontex is a global manufacturer and distributor of primarily baby care and
home care products with leading market positions in Argentina, Brazil and Europe in the core categories it serves. Its baby care
portfolio includes feeding bottles, soothers, teats and other infant accessories sold primarily under the Fiona®, First Essentials®,
Lillo®, NUK® and Tigex® brands; and health care products, including condoms sold under the Billy Boy® brand. Its home care
portfolio includes sponges, rubber gloves and related cleaning products for industrial, professional and retail uses sold primarily
under the Mapa® and Spontex® brands. The Acquisition is expected to expand the Company’s product offerings and distribution
channels into new, attractive categories and further diversify revenue streams and increase the Company’s international presence.
The Acquisition is consistent with the Company’s strategy of purchasing leading, niche consumer-oriented brands with attractive
cash flows and strong management. Mapa Spontex is reported in the Company’s Branded Consumables segment and is included in
the Company’s results of operations from April 1, 2010 (the “Acquisition Date”).
Based on the Company’s independent valuation of Mapa Spontex, the Company allocated the total purchase price, net of cash
acquired, to the identifiable tangible and intangible assets acquired and liabilities assumed based on their estimated fair values on
the Acquisition Date. Based on the purchase price allocation, net of cash acquired, the Company allocated approximately $9 of the
purchase price to identified tangible net assets and approximately $107 of the purchase price to identified intangible assets. The
Company recorded the excess of the purchase price over the aggregate fair values of approximately $129 as goodwill.
In addition, the Company completed three tuck-in acquisitions during 2010. On October 1, 2010, the Company acquired Aero
Products International, Inc. (“Aero”), a leading provider of premium, air-filled mattresses under brand names including Aero®,
Aerobed® and Aero Sport®. The acquisition of Aero is expected to expand distribution channels, as well as expand the Company’s
current Coleman product offerings of indoor and outdoor air beds and accessories. Aero is reported in the Company’s Outdoor
Solutions segment and is included in the Company’s results of operations from October 1, 2010. On December 17, 2010, the
Company acquired Quickie Manufacturing Corporation (“Quickie”), a leading supplier and distributor of innovative cleaning
tools and supplies. Quickie designs, manufactures and distributes cleaning products including mops, brooms, dusters, dust
pans, brushes, buckets and other supplies, for traditional in-home use, as well as commercial and contractor-grade applications
sold primarily under the leading brands Quickie Original®, Quickie Home-Pro®, Quickie Professional®, Quickie Microban® and
Quickie Green Cleaning®. The Quickie acquisition complements the Mapa Spontex acquisition by combining Quickie’s leading
domestic position in household stick and smallware cleaning supplies with Mapa Spontex’s leading international position in gloves
and sponges and provides the Company with a complete product line in conventional cleaning supplies to offer our retailers both
domestically and internationally. Quickie is reported in the Company’s Branded Consumables segment and is included in the
Company’s results of operations from December 17, 2010.
The combined cash purchase price, net of cash acquired, for the Aero and Quickie acquisitions was approximately $270, subject to
certain adjustments. Based on the Company’s preliminary independent valuations for Aero and Quickie, which are subject to further
refinement, the Company allocated the total purchase price for these acquisitions, net of cash acquired, to the identifiable tangible
and intangible assets acquired and liabilities assumed based on their estimated fair values on the respective acquisition dates.
Based on these purchase price allocations, the Company allocated approximately $6 of the purchase price to identified tangible
net liabilities and approximately $159 of the purchase price to identified intangible assets. The Company recorded the excess of the
purchase price over the aggregate fair values of approximately $121 as goodwill.
Additionally, during 2010, the Company completed another tuck-in acquisition. All three tuck-in acquisitions were complementary to
the Company’s core businesses and from an accounting standpoint were not significant.
For 2010, cost of sales includes a $27.4 charge for the purchase accounting adjustment for the elimination of manufacturer’s profit in
inventory related to these acquisitions.
For 2010, SG&A includes approximately $23 in transaction costs related to these acquisitions.
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